The Nigeria’s Central Bank urged citizens to take advantage of the sovereign sukuk being offered by the Federal Government in order to support the country’s infrastructural development while making money.
At an investors’ forum organised by the Debt Management Office in Kaduna, the CBN’s Deputy Director, Financial Markets Department, Mr. Demenongu Yanfa, assured participants of the apex bank’s commitment to the smooth running of the Islamic bond, a statement issued by the DMO said on Sunday.
According to Yanfa, the sukuk will not only allow Nigerians to take ownership of the roads with half yearly rental incomes, but will also fast-track the building of road infrastructure in the country.
He said, “The world is looking for new areas of investment. As of today, South Africa, Malaysia and some other countries of the world have embraced sukuk; this is to fund the construction and rehabilitation of key sectors of their economies.”
He expressed optimism that Nigerians would embrace the novel funding alternative for government’s projects, promising that the CBN would work with other relevant government agencies to ensure the success of sukuk.
The Director-General, Debt Management Office, Ms. Patience Oniha, said at the forum that sukuk is an investment certificate representing the ownership interest of the holder in an asset or pool of assets, adding that the certificate would entitle the holder to receive income from the use of the assets.
She said, “₦100bn is proposed to be raised by the Federal Government under the sukuk programme through investors’ participation. The funds shall be used for the construction and rehabilitation of sections of key economic roads across the six geo-political zones of Nigeria.
“The sukuk is sharia-compliant as a non-interest security, which has been approved by the Financial Regulatory Advisory Council of experts of the CBN. With sukuk, we can improve our road infrastructure and this will contribute to the improvement of economic activities across board.
“We have taken it upon ourselves to continue educating the public about sukuk and the roadshow started in Lagos before moving to Port Harcourt, Kano, Abuja and we are now in Kaduna to create awareness about the investment opportunity.”
She assured investors that all the funds raised would be pooled into a specific account at the CBN to ensure that those funds were spent on the purposes for which they were meant.
In another development, Africa’s richest man, Aliko Dangote, has described the debut N100bn Federal Government of Nigeria sukuk offer as a paradigm shift in government’s efforts at seeking alternative funding for critical infrastructure.
Speaking in Lagos when the Director-General of the DMO paid him a visit, Dangote described the sukuk as a commendable initiative and urged Nigerians to invest in the offer.
According to him, though the Dangote Group was doing a lot with the government, the company will invest in the financial instrument as a way to promote infrastructural development.
He said, “I must commend the DMO for having this creativity with this N100bn sukuk initiative. It is a right move in the right direction as government seeks fresh capital to fund infrastructure in the country.
“I want to urge Nigerians to invest in the offer as it is high-yielding with 16.47 per cent. It is tax free, and will be beneficial to all who invest; it will enhance infrastructural growth.”